Regardless of the type of consulting firms, this industry is on the upswing.
There are many reasons business owners seek the help of a consultant and will continue to do so. Here are a few:
- The consultant has specialized training, expertise and applied experience. Their internal staff doesn’t.
- The company doesn’t have the budget or time to create a permanent position.
- The company feels too close to the project. They see the benefit of bringing in outside expertise as a failsafe against the unexpected.
…and that’s hardly an exhaustive list. In this article, we’ll share some business savvy tips for choosing the right type of consulting firms for your business. Let’s begin!
1. Decide Why You Need a Consulting Firm
Your company should first consider its position before hiring a consultant. Where are you in your market, and where would you like to be? Identifying your shortfalls is humbling, but it’s necessary to find the right types of consulting firms for your business.
Perhaps your staff lacks a key piece of training. Maybe you haven’t developed your social media presence, or you’re working in silos and not enough on a common mission.
Don’t even think about hiring a consultant (and that’s coming from professional consultants) until you figure out why you’re incapable of taking care of the problem in-house. The best consulting firms want you to maximize efficiency, do the job right and save money.
They could take the easy way out and cash your check at a high hourly rate for something relatively simple. If that’s the case, you probably wouldn’t want them working for you, anyway. Know your limitations.
Fully understand the goals and objectives ahead. This will help you get the level of service expected from the consultant and guarantee a mutually beneficial relationship.
2. Research the Market
Starting a company comes with its share of prerequisite homework. One of the biggest assignments is to research your industry to determine who the major, mid-level and minor players are.
You must have done this homework by the time you get to No. 1. It’s difficult to know where you’re positioned in the market if you’re unaware of its size and all the players.
Let’s be clear before turning you loose on this. You want to know who the winners and the losers are in your industry. You can learn a lot from both!
There are two ways you can research the market:
Primary Sources
- Sending out surveys and questionnaires
- Starting a focus group
- Interviewing experts or friendly rivals
Primary sources are excellent for the most up-to-date and reliable information.
Secondary Sources
- Find previously published data and see what it tells you
- Read relevant books, magazines and websites in your industry
Use both types of sources. Incorporate what you can into your organization.
3. Focus on Experience
You’ll hear advice to “get the most experienced” consultant you can find. Experience is important, but that’s not always the best advice for reasons we’ll dive into later.
For now, let’s do a deep-dive focus. Experience. What does it mean?
In the consulting world, it means connections. To whom is the consultant affiliated? Who have they done business with in the past or currently?
You don’t need several connections either. Look at the depth relative to the client or project. If a consultant has proven themselves on a high-profile project similar to yours, then that could be all the “proof” you need of their abilities.
And that brings us to the second point about Experience (note the capital “E”). It also means real-world experience. In booming times like these, you’ll see many people hang a shingle claiming they’re a “consultant.”
But how have they proven that in the real world? If the project and price are right, you might try a newbie, but that’s not something you’ll want when millions of dollars and your industry reputation are at stake.
4. Talk to Any Firm You Are Serious About Hiring
Consider this an extension of your experience assessment. What it looks like on paper is worthy of consideration, but there’s a good reason job interviews are conducted after a candidate hands in their resume.
Being able to see and hear how they communicate, especially in a high-pressure situation like that one, will give you a better feel for how what’s on paper translates to real life. The same is true for consultants.
Don’t just hire a company sight-unseen because they worked for Apple, Google or some other hugely successful company. Get a human face in front of you, preferably the one you’ll be working with for the entirety of your project.
Being able to sit down with your consultant, whether in person or on the phone, will give you the opportunity to have peace of mind with your decision. Such direct contact will:
- Let you experience how they communicate
- Ask follow-up questions that might not occur to you while reading their resume
- Clear up any misunderstandings you both might have about the project scope
- Gauge how they compare to any competitors in their market
- Understand the real value they claim to have created for their clients so you can then check that (see No. 5)
Boutique consulting firms particularly are great about making the time for you, but larger firms who take you seriously will also be glad to make time (and possibly expenses) for you.
5. Ask Around
Something you’ll likely pick up when talking to your prospective consultant is a list of references. By all means, contact each one, but don’t stop there.
References provided to you by the consultant likely will tell you exactly what the consultant wants you to hear, and many times, their praise will be well-earned.
It’s also important to investigate. Find other companies either directly in or next to the industry. See what their impressions are of the consultant.
This serves a few purposes. It can:
- Affirm the value of the consultant
- Highlight issues they may try to sweep under the rug
- Show you how much of an impression they’ve left on your industry
To this last point, reputation and familiarity can be important even if the people you’re talking to haven’t worked with the consultant directly. If they’ve left a deep impression, whether it be positive or negative, you should be able to gauge it from these types of discussions.
6. Know How They Work Before You Hire Them
When hiring a marketing firm, you wouldn’t just bring them in and allow them to take over your images, videos, verbiage, and brand marks without giving them some direction. However, you wouldn’t do the work for them either.
Hiring a consultant for the first time is like this, too. You want to be involved, but you also want them to do the job you’re hiring them to do.
Here’s something important to remember. They want to do that job, but to do it effectively, it requires a certain degree of “hands-off” from you.
You can’t be a micromanager when bringing someone on board. You’ve got to learn to trust their expertise, especially when paying their rates. This ensures they deliver to the level of expectation you’ve set for them.
Save yourself, and your consultant, from turmoil. Before bringing them in, ask about their process.
How do they prefer to work? What do they need to get started? What might they need along the way?
Having a clear understanding of their process will help you know what to expect. It also will free you up to focus on your work while theirs is underway.
Having this conversation ahead of time will help you avoid contracting someone who’s difficult to work with. If you hire them anyway, it will prepare you and your team for potential complications before they arise.
7. Hammer Out an Agreement
Having the conversations spelled out in No. 6 is one thing, but for the consultant relationship to work, you need to get every term in writing.
A written document provides clear protections for you and the consultant. It solidifies understanding, and it calls out any last-minute miscommunications before the relationship officially begins.
It also spells out in clear terms they must meet certain milestones within a specified time and provides for contingencies should those terms change.
For example, if a milestone can’t be reached by the deadline, or all deadlines/tasks need to change due to insufficient data. A simple agreement hammered out between you and the consultant directly with a final review by an attorney would suffice.
With more complex jobs, you’ll want an attorney experienced in writing those agreements. If you don’t have one on staff, look for someone in your area with solid credentials in contract law.
8. Let it Ride
…as Richard Dreyfuss would say. Look at how far you’ve come! You have a good feel for your company’s goals and objectives, and how the consultant can help, their work style and a written agreement.
Now it’s time to enact the most important tip. Let go!
If you’ve incorporated tips 1-7 into your hiring standards, then it’s time to trust that legwork. Give your consultant space and the tools they need to do their work.
You’ll want to check in and meet at different intervals to discuss their findings and conclusions, but never confuse their job for your job.
They’ve made it through your process. They have the judgment and the values and the capabilities you’ve deemed important. You owe it to yourself to see what they find or recommend.
For many companies, this is still a struggle. Whenever there’s a temptation to step in and take over, just remember what brought you to this point.
Trusting in your consultant’s judgment is trusting in your own judgment, and you owe it to yourself to do exactly that.
Now it’s time to wrap up, but before we do, let’s look at the one hiring mistake you could be in danger of making.
A Warning About Hiring Big Consulting Firms
This is something that, so far, we’ve only touched on, but it’s important to emphasize the danger.
Whenever you mobilize to hire, there’s a temptation of going after the biggest name in your industry and hiring them on brand recognition alone. And why not? They’re established because they have a long and a proven track record, right?
That may be the case, but every company is different, yours included. You may not have the same needs as their clientele.
There are some common problems you will run into going strictly after name recognition. They are:
Too Much Money for Too Little Effort
The big firms can get away with charging top-dollar, but that doesn’t mean they will work as hard for you as they do the large clients who can afford to keep them on retainer. And that leads to:
Being Relegated
Coca-Cola is a huge company. Few are bigger. If you run a small business, then you cannot possibly compete with their wallet.
What happens when you hire a consultant who works alongside Coca-Cola? You might pay the same hourly rate, but if it comes down to your needs and theirs, they will go with their needs every time.
They don’t need you as long as they’ve got a bigger client, and they’ll treat you that way should push ever come to shove.
They Do Not Want a Lasting Relationship
You may need an ongoing relationship with a consultant that’s focused on your needs. But consultants who work mostly with larger firms can’t afford to give you that time and attention.
As a result, you’re an afterthought. Someone they “get to when they get to.” A smaller, lesser-known consultant can be a much better use of budget.
What Is “Your Type” of Consulting Firms?
Every company has a different type of consulting firm they use. What’s yours? To answer that question, use the business savvy tips we’ve presented here.
If you’re ready to learn more about what a consultant relationship can bring to your business, contact Glenmont Consulting today for a consultation.